Google began rolling out expanded text ads (ETA), responsive ads for display, and mobile bidding options recently announced at the Google Performance Summit. The AdWords worldwide updates aim to improve the performance of mobile campaigns.
While expanded text ads and responsive ads bring a way to connect with consumers, device bid adjustments provide more control and flexibility to optimize campaigns with greater precision.
Expanded text ads feature two headlines, each with 30 characters, and one long 80-character description line. Guitar Center, L'Oreal, EE and Kueski are some of the brands running early ETA tests with Google.
Independent data from ad agency Merkle confirms Google's assumption that shows these longer ad headlines are more useful when searching for information on mobile devices because they provide additional information before clicking on an ad.
"Google hopes with this change they can generate higher click-through rates, and we indeed see that, but it's still early days," said Mark Ballard, senior director of research at ad agency Merkle.
In the Digital Marketing Report Q2 2016 that Merkle plans to release Tuesday, early tests show an increase in click-through rates (CTRs) of around 8% for tablets and 4% for smartphones, compared with the overall 20% possible increase Google notes in its blog post announcing the rollout.
Merkle analyzed early ETA performance relative to traditional text ads, assessing CTR performance for thousands of ad groups that added ETAs and had significant impressions for the new format.
When separating brand and non-brand ad groups to mitigate the effects of query mix on the analysis, Merkle found that ETAs produce a 16% higher CTR than traditional ads for non-brand ad groups on desktop computers for the median advertiser analyzed for the study.
The differences vary significantly by advertiser and even by device for each advertiser, per Merkle. A number of individual advertisers see ETAs produce lower CTRs for non-brand traffic on certain devices.
Ad groups using the longer format are receiving 47% of total impressions from ETAs, per Merkle's study.
Retailers will need the extra help as ecommerce and mcommerce continue to rise. U.S. retail ecommerce is expected to climb 13% to $384.79 billion in 2016, eMarketer estimates. The analyst firm expects mobile retail sales in the U.S. to rise 39.1% to $123.13 billion in 2016, compared with 2015, accounting for 32% of the total U.S. ecommerce market. U.S. retail sales, online and offline, will reach $4.8 trillion, up 2.0% compared with 2015, per eMarketer.